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The changing TV landscape

More than half (54%) of adults in the UK like the freedom of being able to watch when and where they want on their tablet or smartphone. Seven in ten (67%) say they like to watch TV programmes and films on-demand to avoid adverts, or because there are no adverts. ‘Binge watching’ is now commonplace with 35% of people in the UK saying they do it at least weekly.

The power of the online image

In 2012 text messages were the most-used method of everyday communications with friends and family. But five years on, the landscape has shifted, with images becoming an increasingly central method of communication. There have been reports that emojis are now the fastest-growing language in the UK, Snapchat is now used by more than 158 million people worldwide every day, and the rise of Instagram has paved the way for the creation of a whole new celebrity: the ‘instafamous’.

The reach of broadcast TV remained high in 2016, with 91% of the TV population watching TV at least once in a typical week in 2016.

The time spent watching broadcast TV continued to decline in 2016, although to a lesser extent than in previous years, decreasing by four minutes since 2015 to an average of 3 hours 32 minutes a day across all individuals aged 4+.

Within that overall decline, there is a widening gap between the viewing activities of the youngest and oldest audiences. The steepest decline in average viewing of broadcast TV was among children (4-15) and adults aged 16-24, while average viewing for over-64s increased slightly. Furthermore, new research from Ofcom found that 66% of teens use YouTube to watch TV programmes/films compared to 38% of all adults in 2017.

Despite the threat from online services, revenues for the broadcast TV industry increased by 1.0% in real terms to £13.8bn in 2016, with further revenue of £1.7bn generated by online AV services. Within this, net advertising revenue in the traditional TV sector exceeded £4bn for the second consecutive year. Despite fundamental changes in the advertising market over the last ten years, the television advertising market has remained very resilient due to its primacy in providing mass audiences.

People in the UK consume a range of audio content including live radio, streamed music, recorded music and podcasts, on a range of devices.

Overall, 63% listen to music-focused radio stations, while 38% listen to radio stations that are mainly speech-based. Three in ten say they use an online music service, while 16% have listened to podcasts.

Despite the range of ways in which audio content can now be consumed, the reach of live radio remains extremely high. Nine in ten people (89.6%) in the UK listen to the radio at least once a week – listening has remained at this level for the past five years.

While the proportion of people who listen to the radio has not changed year on year, people are listening to the radio for longer. Average listening per week increased by six minutes in the 12 months to Q1 2017 compared to the previous year, rising to 21 hours 24 minutes. This increase was driven by those in the middle of the age range; the youngest and oldest age groups decreased their average radio consumption by 18 minutes a week.

By June 2016, 44% of all fixed broadband connections were able to receive actual download speeds of 30Mbit/s or more, up from 38% a year previously. Nearly two-thirds of mobile subscriptions were enabled for 4G, up from 46% in 2015. Consumers are also using these networks more – average data use per fixed line residential broadband connection increased by 36% year on year to 132GB in June 2016, and average data use per mobile connection increased by 44% to 1.3GB.

Most households have both fixed broadband and a smartphone, and consumers are moving seamlessly between fixed and mobile connections. Our mobile-app-based research shows that around two-thirds of data connections made by our panel of Android smartphone users are via a Wi-Fi network, with the remaining third via a mobile network.

Average monthly household spend on telecoms services increased by 0.9% and accounted for 3.8% of total household spend for the year.

The internet is essential to the way in which people in the UK communicate, find information, seek entertainment, shop and participate in society;

Eighty-eight per cent of adults now have internet access at home. Reach is highest among younger age groups, but over half (53%) of over-74s are internet users.

For most people, mobile devices are their most important device for accessing the internet. Consistent with high take-up, more than four in ten (42%) UK internet users, including nearly two-thirds of 16-34 year olds and 44% of 35-54s, regard their smartphones as their most important device for accessing the internet. For those aged 55 and above, fewer (13%) consider smartphones their most important device for internet access. Just under a third of over-54s consider laptops to be their most important device (31%), followed by tablets (27%) and desktops (22%).

The smartphone is the device that adults are most likely to own (76%); ownership is higher than for laptops (64%) and tablets (58%). Smartphone ownership is highest among younger adults; more than nine in ten 16-24s and 25-34s (both 96%) own one. Desktop PC ownership is now 29% across the UK, and ranks lowest of the most important devices for internet access in 2017 (11%).

Total addressed letters volumes continued to decline in 2016, falling by 4% between 2015 and 2016 to 11.8 billion items.

This decline reflects not only ongoing substitution away from letters to electronic communications, but also significant declines in advertising mail volumes in the past year, reported to be as a result of business uncertainty. Access mail volumes (i.e. mail from operators who pay Royal Mail for final delivery to the end customer) continued to grow as a proportion of total letter mail volumes in 2016, reaching 60% of the total (up from 57% in 2015). Letters delivered by operators other than Royal Mail amounted to 0.1% of total volumes, a total of 16 million items (down from 68 million in 2015, largely due to Whistl ending its door-to-door delivery service).

While letter volumes have continued to decline, a trend in recent years has been the increase in parcel volumes, driven by the increase in internet shopping. Postal operators have continued to invest in their parcel delivery networks. Firms have invested in new warehouses and distribution centres or installed new technologies to drive greater automation and allow for the more rapid tracking of packages and greater flexibility in delivery. In addition, some postal operators, including Royal Mail and TNT, have used mergers and acquisitions (M&A) over the past year to develop their parcels delivery businesses in the UK and abroad.